Contents
Undertaking i
Acknowledgments ii
Abstract iv
Table of contents vii
List of figures xiii
List of tables 16
1. Introduction 17
1.1 Need for study 19
1.2 Research aim 21
1.3 Research questions 21
1.4 Research objectives 22
1.5 Methodology 22
1.6 Scope and limitations 22
1.7 About the study area 23
2. Understanding property tax 24
2.1 Revenue sources of ULBs 24
2.2 Property tax: A crucial internal revenue source 25
2.3 Evolution of property tax and important milestones 25
2.4 Property tax 27
2.4.1 Legal provisions 27
2.4.2 Components of property tax 28
2.4.3 Methods of assessment 29
2.5 Current problems in property tax system in India 31
2.6 Major reforms and initiatives to improve property tax revenues 33
2.7 Best practices in various cities 34
2.7.1 Bangalore 34
2.7.2 Patna 34
2.7.3 Ahmedabad 35
2.7.4 Hassan, Karnataka 35
2.7.5 Vishakhapatnam 35
2.8 Summary of learnings 36
3. City profiling 37
3.1 Wai, Satara 37
3.1.1 Location and demographics 37
3.1.2 Legal, institutional and administrative framework 38
3.1.3 Budget analysis 39
3.1.4 Revenue sources of the ULB 40
3.1.5 Property tax: an important revenue source 42
3.1.5.1 Per capita property tax 43
3.1.5.2 Property tax bill 44
3.1.5.3 Method of assessment 44
3.1.5.4 Billing and collection 47
3.2 Sinnar, Nashik 48
3.2.1 Location and demographics 48
3.2.2 Legal, institutional and administrative framework 48
3.2.3 Budget analysis 49
3.2.4 Revenue sources of the ULB 50
3.2.5 Property tax: an important revenue source 52
3.2.5.1 Per capita property tax 54
3.2.5.2 Property tax bill 55
3.2.5.3 Method of assessment 56
3.2.5.4 Billing and collection 60
4. Assimilation of findings, analysis and key observations 61
4.1 Property tax as the backbone of ULBs 61
4.1.1 Share of property tax in own revenue of the ULB 62
4.1.2 Share of tax and non-tax revenues in total revenue of the ULB .63
4.1.3 Share of tax revenues: property tax as a dominant tax revenue source 65
4.2 Tax net of ULBs 66
4.3 Method of assessment, base unit rates and exemptions 67
4.3.1 Method of assessment 67
4.3.2 Exemptions 69
4.4 Collection efficiency 70
4.4.1 Property tax: amount collected v/s demanded 70
4.4.2 Property tax: arrears 71
4.4.3 Collection efficiency 73
4.5 Expenditure on property tax and process efficiency 74
4.5.1 Expenditure on property tax 74
4.5.2 Process efficiency 75
4.6 Property tax as a local government responsibility 77
4.7 Summary of findings 78
5 Conclusion and way forward 81
5.1 ULB level 81
5.1.1 Revision in method of assessment for open plots 81
5.1.2 Revision in method of assessment for rent properties 82
5.1.3 User friendly payment options for improving collection efficiency 82
5.1.4 IT enabled solution for effective and efficient data management 82
5.2 State level 83
5.2.1 Frequent revision of base unit rates 83
5.2.2 Levying other flat charges as a component of property tax 83
5.2.3 Incentives for improving collection efficiency 84
5.2.4 Routine monitoring by the state 84
References 85
Appendix 1: Questionnaire of municipal councils 87
Appendix 2: List of officials interviewed 90
Appendix 3: Property tax bill for Wai 91
Appendix 4: Property tax bill for Sinnar 92
Appendix 5: Notice issued for new assessment method in Sinnar 93